Sweetening the Pils: Radlers invigorate East Europe beer markets

05 March 2013

The brewing industry can be quite conservative and market specific; beers popular in one area often do not translate into success in other regions, let alone other countries. However radlers have bucked this trend and more than that they have recently revived beer markets which were considered to be in long term, slow decline. Fruit flavored radlers have found success in several eastern European markets namely; Croatia, Czech Republic, Hungary, Romania, Serbia, Slovenia and also Bulgaria. This success has been sudden; in Croatia radlers gained 8% share in 2011 from a starting base of almost zero. These beer mixes have exceeded brewers’ most optimistic expectations.

Radlers have a long history in German speaking regions with recipes dating from 1912. A radler is a beer mix, a beer mixed with a soft drink, usually lemonade eg lager shandy. The name literally translates as “cyclist” and refers to its history as a sports drink, these drinks were traditionally popular for their thirst quenching properties and therefore initially popular with cyclists. However they fell out of fashion and (although occasionally created by bartenders, and at home) had virtually disappeared until the 1990s when the emergence of the "Coke" generation, weaned on sweet drinks, were beginning to show signs of finding beer too bitter and looking for sweeter tasting alcoholic beverages. This manifested itself in many markets in the emergence of alcopops (FABs). In Germany brewers headed off the threat from FABs by revisiting the radler idea and increasing the scope too include many other flavours such as cola, dragonfruit and orange. This became the beermix phenomenon. Recent years have seen the sector coalescing around the more traditional ‘beer + lemonade’ proposition, especially in markets outside of Germany. Although radlers became popular in Germany, and despite the popularity of panache (a very similar drink) in France, Switzerland, and Italy, this drink was not widely available in other parts of the world.

Why have these drinks achieved such sudden popularity? Refreshment seems to be a major factor and they have often done very well in markets experiencing a hot summer. Invigorating flavors such as lemon, orange or lemon-lime seem to be the most popular although a wide range of flavors have been launched. As a refreshing option for a hot day radlers are challenging soft drinks categories such as carbonates and juice in on-premise channels as well as taking share from other beer segments. The sweeter flavor also appeals to younger drinkers no attuned to the bitter taste of beer.

Young drinkers are prepared to experiment (perhaps in contrast to the ‘traditional’ beer drinker) and are looking for something new and high quality. This seems to be especially true of young female drinkers who are being drawn towards flavored radlers possibly attracted by the low alcohol content which is also creating new consumption occasions. In this search for novelty, flavored radlers are probably riding the same wave of popularity as speciality and microbrewery beers. The low alcohol content also connects with a general trend towards lower alcohol consumption which is borne out of the health and wellness trend.

All of the major multinational brewers have at least one flavored radlers in their portfolio in relevant areas in eastern Europe and local brewers and microbreweries are also participating in the trend. Private Label versions are available in many markets, especially from hard discounters.

The situation looking forward is something of a mosaic. For example in Croatia the expansion period seems to be over and competition within the segments in terms of brands, packaging and flavors is hotting up, whilst in the very important beer market of the Czech Republic radlers however are expected to see more growth but in Slovenia a contraction in the segment is expected. Overall, it appears that in markets where radlers have expanded rapidly growth may slow but brewers will compete for shares of the beer mix segment.

Flavored radlers have been launched into new markets with brewers hoping to emulate the success which they’ve had in many parts of eastern Europe. The UK has recently seen Heineken launch Fosters Radler a lemon flavored radler in 2013; Canadean Beer Market Insight reports will be analyzing the performance of radlers in these new markets and are the best place to monitor the performance of these drinks.